The holding companies of Park Cities Bank in Dallas, Tex., have filed for bankruptcy in order to facilitate the recapitalization and purchase of the bank by Park Cities Financial Group.
The bank's holding companies, North Texas Bancshares and North Texas Bancshares of Delaware, filed for Chapter 11 bankruptcy in Delaware on Wednesday, listing about $39 million in debt. Park Cities Bank is not part of the Chapter 11 process.
The $422 million-asset Park Cities Bank, which is under a Federal Deposit Insurance Corp. consent order to increase capital and reduce troubled assets, will be sold to Park Cities Financial Group in Dallas. The group is led by investor Darwin Deason, who founded Affiliated Computer Services in 1988 and sold it to Xerox for $6.4 billion in 2010.
The financial terms of the deal were not disclosed. There are no planned layoffs and the bank's employees and customers will not be disrupted by the sale, according to chief executive John Dienes.
"We have been working diligently to secure a strategic partner with a shared vision and commitment to strengthen Park Cities Bank and lead it into the future," Dienes said in a Wednesday press release. "This transaction provides capital to facilitate lending and business development in the communities we serve. Park Cities Financial Group is an ideal fit for the banks customers, employees and for growth in our market. We are all excited about the opportunity to work with new ownership for the continued success of the bank."
Park Cities is required to maintain a Tier 1 leverage ratio of at least 9% and total risk-based capital of at least 13% under the FDIC consent order. The company had a Tier 1 leverage ratio of 6% and total risk-based capital of 10% as of Sept. 30. It lost $4.6 million through the first nine months of this year, according to its most recent FDIC call report.
The holding companies' financial advisor is Commerce Street Capital. Bracewell & Giuliani serves as the holding companies' legal advisor. Park Cities Financial Group was advised by Jackson Walker.